Fundamental reform of the Atol scheme is “not feasible” by the CAA’s targeted start date of April 2024, say senior figures in the sector, although some change may be possible.
The CAA’s ‘Request for further information’ on Atol reform, released in January, identifies April next year as the potential start date for transition to a new regime.
Alan Bowen, advisor to the Association of Atol Companies, told a Travel Weekly Future of Travel webcast: “It depends what the CAA expects to happen on April 1. If it’s looking to get people to move to trust accounts, that is not possible.
“If we’re looking at a variable Atol Protection Contribution [APC], that would be a possibility.”
He argued: “We know from the CAA’s research that consumers would be happy paying a £10 APC rather than £2.50. If the CAA moved to a variable APC and increased [the average payment] to £5 for everybody, it wouldn’t be a problem because, ultimately, the consumer pays.
“But moving to trust accounts is not realistic [by then].
“I don’t see fundamental change from April 2024 as feasible. Look at the timescale – we need a three-month consultation after the CAA reaches a decision. We’re not going to know what is happening before Christmas.”
Abta director of financial protection and membership Rachel Jordan agreed, saying: “The more fundamental the reform, the longer the transition will need to be.”
But she doubts whether even a variable APC could be introduced by April next year, saying: “Based on what we’re hearing from members I’m not convinced a variable APC would be achievable. It depends how it would be introduced.
“Let’s say it is [calculated] on the value of trips. We have businesses selling holidays for 2025. If a variable APC based on the average price of trips is forward looking, that is possibly OK. [But] if it was to come in retrospectively, it’s not feasible.
“People have priced trips and have marketing out there. They’ve told customers the price.”
She insisted: “It comes down to the detail. If members had more detail, they could provide more constructive feedback around what would work and what transition period they would need.”
Responses to the CAA’s ‘Request for further information’ on Atol reform had to submitted by March 24.
More: Special Report: CAA asserts case for change on Atol